The green and hard machining characteristics of dental ceramics are of great interest to dental industry. The green bodies of TZP/$Al_2O_3$ composites were prepared by the cold isostatic pressing, and machined on the CNC lathe using PCD (polycrystalline diamond) insert under various machining conditions. With increasing nose radius of PCD insert, surface roughness initially increased due to increased cutting resistance, but decreased by the onset of sliding fracture. The lowest surface roughness was obtained at spindle speed of 1,300 rpm and lowest feed rate. Hard bodies were prepared by pressureless sintering the machined green bodies at several temperatures. The grinding test for sintered hard body was conducted using electroplated diamond bur with different grit sizes. During grinding, grain pull out in the composite was occurred due to thermal expansion mismatch between the alumina and zirconia. The strength of the composite decreased with alumina contents, due to increased surface roughness and high monoclinic phase transformed during grinding process. The final polished samples represented high strength by the elimination of a phase transformation layer.